Posted by By Dawda Faye
Mr. Fadia Mazegi, Managing Director of EURO Africa Group, today went through vigorous questioning during his reappearance before Janneh Commission in connection to NAWEC contracts executed by his companies, i.e. Global Management System (GMS), Global Trading Group (GTG) and Global Electrical Group (GEG) amongst others.
Prior to his testimony, he was asked by Mrs. Bensouda to look at a letter from NAWEC dated 26th September, 2002, as well as a letter written by Mr. Abdoulie Jobe to Mr. Bazzi which were all in connection to the Heavy Fuel Oil (HFO) contract between Global Trading and NAWEC.
He went through the said letters and confirmed that they were from Global Trading Group. He added that what Shell Company was charging for HFO was more than what GTG was charging. He testified that the 17% charge was not part of the agreement.
However, Counsel Bensouda told him that the NAWEC tanks cost D2,000,000 and the purpose of GTG documents to NAWEC was not to show them the analyses and that they were supposed to compensate NAWEC for the delivery tanks for a period of 5 years, noting that the compensation was for free storage and transportation of fuel at the Mandinary depot for a period of 7 years, because the tanks at Half Die were not installed.
Mr. Mazegi informed the commission that they could not build the tanks because of poor soil quality and that was why they opted to give NAWEC free storage and transportation for the next project, but the failure to build the tanks was with NAWEC.
At this juncture, Counsel Bensouda put it to him that the issue of the tanks was not captured in the agreement despite the fact that GTG was in control of NAWEC. In response, Mazegi said: “We were never managing NAWEC. This is a very wrong impression.”
It was further put to him by counsel that they were compensating NAWEC for what was past, and then asked him why the margin remained 17%. He responded that what they gave NAWEC was more than what they should have given the company.
The business tycoon further testified that the value of what they were offering did not reflect on their records; adding that NAWEC was in arrears of the payments and they had huge deficits. He said NAWEC obtained other options to get fuel, noting that they were under threat from the former executive.
At this juncture, Counsel Bensouda reminded him that a contract between Global Management System (GMS) and NAWEC took effect in 2007 and at that time, they had the responsibility for the management of NAWEC. She also told him that it was difficult to appreciate that NAWEC could not pay their arrears.
In response, he told the commission that they never managed NAWEC, further stating that they reduced the tariff when the price of fuel went up. He added that the taskforce was not involved in the signing of the contract in 2007, and that the role of the taskforce was to assist NAWEC with technical work.
Still testifying on the contract, he revealed to the commission that he did not negotiate for the renewal of the contract but it was extended with the same terms and conditions of the previous contract.
According to him, as at 2010, NAWEC started defaulting payments on both the HFO and IPP respectively, noting that this was because there was a reduction on their tariff, notwithstanding, they continued to supply NAWEC.
Mr. Mazegi adduced that the Global Electrical Group was operating the IPP, and that they bought used generators from China and spare parts from Europe. He said that the generators were reconditioned in China, further stating that he could not remember how much they bought the generators for.
Counsel Bensouda challenged him that they did not have financial records to show how much they bought the generators, but he said that they did not have the financial reports.
“I would expect that you have financial records of this investment,” Bensouda took him to task.
On the capacity charge, he testified that it was a reflection cost made by the investor; adding that they signed a power purchase agreement with NAWEC. He said they were the only company that accepted to sign for the IPP contract without any guaranty from the former government.
Mr. Mazegi disclosed that on asset value, the cost of their investment was over $40,000,000.
At this juncture, Counsel Bensouda put it to him that NAWEC staff were under duress on the agreement, and he replied that they were fair to NAWEC and that they did not impose anything on the company.
Mrs. Bensouda further asked him to provide the commission with calculations showing how he was able to get the capacity charge. “We would like you to provide the basis of your calculation on the capacity charge,” she insisted. In response, the witness said he did not have the evidence.
On whether GEG owns offices in the Gambia, he responded that they have an office at Brikama. He was further asked whether GEG kept records, and he said he would check. Further asked why they sheltered behind the office of the former president, and in response, he said they did not sheltere behind the office of the former president, and that he did not know anything about heads rolling.
He confirmed that they brought their draft for NAWEC to sign. It was again put to him that the pricing was usually $1,000,000 per megawatt, and he stated that it was calculated because they were in a country where there was no political stability.
Mr. Mazegi was asked why his company did not insist on the guaranty from the former government and he responded that they did not insist. He further stated that they did not discuss the guaranty because it was not on the table.
Responding to Commissioner Abiosseh George, he told the commission that they could not leave the country despite the political instability because they had already invested in The Gambia.
At this juncture, Commission Chairman, Sourahata Janneh, reminded him that he said he holds an MBA and told him that as an MBA holder, before he got into these types of dealings, he needed to prepare a scheme. He responded that he could give the basis but not the amount involved in the investment.
He again asked the witness whether he made any profit during his stay in the country, but he answered that he never had any company but the dividend he had with other companies were profitable.
Mrs. Bensouda put it to him that the capacity charge remained constant. In response, he told the commission it was because of NAWEC’s breach for not paying; adding that the capacity charge was not constant.
He testified that because NAWEC had financial constraints, GTG deferred the capacity charge and it was the office of the former president that instructed NAWEC to stop the capacity charge.
On whether he had any relationship with the office of the former president, he stated that he never had any relationship with the office of the former president and that the question should be put to Mr. Bazzi.
It was again put to him that the office of the former president benefited from his company, and that there were directives from the office of the former president that NAWEC should sign contracts with his company. He responded that they were a reliable and a professional company, and they did the job well on the ground. He finally testified that the energy charge was not high and that there was a fixed charge.
Sitting continues.